Australia’s most militant construction union faces being locked out of the $18 billion East West Link road and tunnel project under the Napthine government’s code of practice for the building industry.

Victorian Treasurer Michael O’Brien said yesterday the preferred bidder for the first section of the cross-Melbourne project had signed up to the government’s construction code.

The code, when fully enacted, will seeks to guarantee freedom of association, ruling out side agreements or other behaviour favouring one union over another.

The code has been opposed steadfastly by the Construction Forestry Mining and Engineering Union building division, making it problematic for it to be represented on-site.

Mr O’Brien announced the East West Connect consortium — comprising Capella Capital, Lend Lease, Acciona Infrastructure and Bouygues Construction Australia — as the preferred bidder for the eastern end of the project. He said observing the construction code was “non-negotiable”, central to being able to bid for and deliver the project.

The government’s selection of a consortium including Lend Lease is significant. Lend Lease previously has been barred from taxpayer-funded projects because of a special deal it had elsewhere with the CFMEU.

The move will open the way for other unions such as the AWU to be represented on-site instead.

While Mr O’Brien rejected suggestions the CFMEU was being “set up’’, the government has campaigned against it and used the union as a political tool to attack Labor for its links.

CFMEU state secretary John Setka warned the code was counterproductive for workers.

“Our priority with any state government project is the safety and the conditions of our members,” he said. “Denis Napthine’s construction code has the potential to disrupt the orderly negotiations around industry standards and conditions.”

The East West Link is an 18km cross-city road connection extending across Melbourne from the Eastern Freeway to the Western Ring Road.

The Abbott government will contribute $3bn.

The first stage of the project is a 6km section connecting the Eastern Freeway with the freeway leading to Melbourne Airport.

Contracts are expected to be signed in October, just before the November 29 state election.